In print and on the web, Photomation is now talking up its
capabilities for producing large format digital display graphics,
fine art and giclee printing, photo prints, and full service
digital/graphic imaging services from design through output.

Now that there are more competitors in the business of producing
photographic images, the key strategy for commercial labs continues
to be in distinguishing themselves from the rest of the
competition. To achieve this, companies must find a niche in what
they do better than competitors in the area and provide customers
with a full menu of digital services.

"There's been ongoing competition in the digital business for
the last 10 to 15 years, " notes Doug Hart, Hart and Associates
Management Consultants. "That competition may have been accelerated
in recent years but it's always been there, and the good companies
are surviving."

As president of the Toronto based market research/consulting
firm to the imaging industry, Hart enjoys a broader view than most
of the trends shaping prospects for lab owners. In September, the
company will embark on an industry-wide customer satisfaction
research program. The goal, says Hart, is to establish performance
benchmarks for digital labs. Through interviews with present and
potential customers in local markets, the project will try to
identify the competitive positioning of digital labs and other
digital service providers. The data should allow company clients to
compare their technical capabilities, marketing and image
performance with labs on a national basis.

Since its creation, his company has regularly surveyed labs and
their customers to gain the insights, which can assist client
companies in developing the strategies to help them grow their
business. "The industry got its legs kicked out after 9/11," Hart
notes. "Business has come back but it has been slow. Growth today
is harder to come by."

For traditional photo labs today, growth is usually driven by
success with digital services. With labs now competing with
printers, service bureaus, sign shops and reprographic houses for
some of the same customers, how labs sell their digital
capabilities is just as important as what they can deliver.

"Marketing (of digital services) is the hard part," says Hart.
"It takes some innovative thinking. The lab owner needs to stand
back and think strategically: 'What things am I already doing well
for customers, and what else can I do well?'"

He says rather than try and be all things digital to all people,
a thorough self-assessment should help the lab owner identify real
opportunities. "Don't try and do all for everyone, you have to
provide a service you know you can make money at," he cautions.
"You have to be selective about what you do, and do it well."

Ideally, that internal assessment should be followed up with a
survey of the marketplace, for insights on how the lab is perceived
against competitors.

"Marketing (of digital services) is the hard part," says Hart.
"It takes some innovative thinking. The lab owner needs to stand
back and think strategically: 'What things am I already doing well
for customers, and what else can I do well?'"

As a professional researcher, Hart believes this is best handled
by an outside firm. "We know how to do it, and who is the right
person to reach," he explains.

When respondents understand they are speaking with an
independent party, they're usually not shy about sharing opinions.
"We're more likely to get candid responses than if someone from the
lab called themselves," he relates. "People can be quite up front
in telling us what they think about a lab, who they use for
different services, even the problems they've had with the lab or
other suppliers."

Insights gained from the internal and external evaluations can
guide the lab in developing an effective strategy for building new
business. Its typically a two part process: identifying ways to
increase sales to existing business customers; then taking your
message to potential customers with an existing need for the same
services.

"I always advise clients to focus on new services for existing
customers first, because you already have a relationship with
them." There's still work involved. " "A lot of homework has to be
done before you make the call," says Hart. "You have to look at
what you do, what you do well, what the customers needs are and why
they should turn to you."

With larger companies, the next challenge may be determining who
should get the sales pitch. "You have to take time, account by
account, to identify who your salespeople should be talking to,"
continues Hart. "Sometimes it can be as simple as asking their
existing contact 'Who should I call in your office in San
Francisco?' and they will make the introduction. With other
companies, it may take a lot of digging before you figure out who
exactly that person is."

With new customers, or when trying to launch new services, the
sales effort needs to be complemented with an aggressive, thorough
marketing campaign to make potential customers aware of all your
capabilities. Use whatever makes sense, says Hart: direct mail,
print, email, work samples, invitations to your facilities so
clients get a better understanding of what you can do.